Dung told the opening of the autumn session of the National Assembly, or parliament, that Vietnam should aim for the upper end of its economic growth target of between 8.5 percent and 9.0 percent next year.

Growth of 8.5 percent is forecast this year after 8.17 percent in 2006.

"Our priority next year is to invest in key infrastructure projects," the Prime Minister of Communist Party-ruled Vietnam said in a speech.

That would help push up the trade deficit to $10.9 billion, some 21.1 percent above the likely 2007 outcome.

Exports are forecast at $58.6 billion and imports at $69.5 billion, in both cases 22 percent up on the forecast 2007 figures.

Overall investment is targeted at 42 percent of GDP in 2008.

GDP is forecast to reach $83 billion next year, which would give per capita income of $960, Dung said in a televised broadcast.

The industrial and construction sectors will be central to growth, with their combined contribution expanding slightly to 42 percent of GDP in 2008 from 41.8 percent in 2007. Agriculture's contribution could drop to 19.2 percent from 20 percent.

Industry and construction are targeted to grow by up to 11 percent and the service sector by between 8.7 percent and 9.2 percent.

A National Assembly report said just $1 billion of the trade deficit this year, expected at $9 billion, was attributable to consumer goods, and the rest to spending on machinery and technology.

Government officials say investment in energy and transport projects, including a host of power plants, highways and oil refineries, will fuel growth for several years.

But to ensure sustainable growth, Vietnam should pay more attention to education and public health as it strives to reduce the widening gap between urban and rural areas, economists say.

The government will sell bonds worth 38 trillion dong ($2.4 billion) in domestic markets next year, of which 10 trillion dong will be spent on building schools and hospitals and 28 trillion dong allotted to roads and irrigation projects, Dung said.

Bankers have said the low yields of government bonds, hovering around 7.8 percent versus corporate bond yields of around 9-10 percent, had failed to attract investors.

Disbursement of government bond proceeds has been slow this year, with only 3.5 trillion dong spent so far, or 22 percent of the total funds planned for 2007, a National Assembly report said.

Source: Reuters.